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Replace 9pm: Provides Exelixis remark.
Exelixis (NASDAQ:EXEL) will face a proxy battle with hedge fund Farallon Capital, who final Monday introduced it nominated three people for the biotech agency. Exelixis ticked up 1% in premarket buying and selling.
“We consider the Firm should focus its R&D efforts and spending, talk a differentiated and coherent technique, decide to ongoing distributions of extra capital to shareholders and increase the Board with new views,” Farallon Accomplice Philip D. Dreyfuss wrote in a letter Wednesday to Exelixis’ board. “This is the reason we lately offered you discover that we intend to appoint three distinctive director candidates to the Board.”
When Farallon introduced it will nominate administrators final week, it hadn’t determined but if it will go forward with a proxy battle and was attempting to work with the corporate, based on a WSJ report on Tuesday. Farallon had been in discussions with Exelixis (EXEL) over the fund’s foremost concern, which is analysis and growth spending, the WSJ stated. These talks lately fell aside.
Exelixis (EXEL) lately reached a near-final settlement to keep away from a proxy contest that included appointing two of Farallon’s nominees and saying the retirement of two long-standing current administrators and forming a brand new Capital Allocation Committee, the corporate stated in an announcement in response to the Farallon letter. An settlement was by no means struck.
“… Farallon demanded a extremely uncommon breadth and depth of data entry as a non-negotiable a part of any settlement, together with unprecedented entry to Exelixis’ pipeline, folks and scientific trial date,” Exelixis (EXEL) stated within the assertion. “This might jeopardize the Firm and all its shareholders, which the Firm can not comply with.”
Final month Farallon Capital, which has a 7.2% stake in Exelixis (EXEL), stated the biotech is undervalued and “must refresh the board.” Farallon stated within the letter on Wednesday that it has been repeatedly invested in Exelixis since 2018.
Farallon additionally stated that Exelixis (EXEL) has greater than $2 billion of money and marketable securities on its steadiness sheet that it wants to search out methods to distribute to holders.
“We have been happy to see the Board reply to our name for a return of capital with its latest announcement of a share buyback, however from our perspective, the plan doesn’t go far sufficient,” Farallon’s Dreyfuss wrote within the letter.
Final month, Exelixis (EXEL) approved a $550M share repurchase program of the corporate’s widespread inventory earlier than the tip of 2023.
